With the coming onset of recession in China, the most important question to ask is: is it cyclical or structural? All answers currently point to structural. In fact, a slightly lower growth rate that comes with massive structural changes to the economy is a good thing and much more sustainable in the long-term. The next question to ask is whether those structural changes are even happening and if so whether they are succeeding. In that vein, here are the most important questions relevant to the coming Chinese structural economic shift:

Will more rounds of infrastructure stimulus be effective?

What is the liability of local government debt?

How does China liberalize capital accounts without a replay of the late-90’s Asian crisis or large-scale capital flight from well-off Chinese/corrupt CCP officials?

What mix of policies gets China to higher domestic consumption?

How big of a drag on the economy are negative externalities like the environment?

How is China meeting its current and future energy needs?

Final bonus question: is the CCP implementing responses to these challenges?